How to Trick the Guilty and Gullible into Revealing Themselves

It starts with a basic understanding of game theory and incentives

King Solomon built the First Temple in Jerusalem and was known throughout the land for his wisdom.

David Lee Roth
fronted the rock band Van Halen and was known throughout the land for his prima-donna excess.

What could these two men possibly have had in common? Well, both were Jewish; both got a lot of girls; and both wrote the lyrics to a No. 1 pop song ("Jump" in Mr. Roth's case and, in Solomon's, several verses from Ecclesiastes that appeared in the Byrds' 1965 hit "Turn! Turn! Turn"). But most improbably, they both dabbled in game theory, as seen in classic stories about their clever strategic thinking.

Early in Solomon's reign, two women came to him with a dilemma. They lived together—they were prostitutes by trade—and within the space of a few days had each given birth to a baby boy. One child had died, and now both women claimed the surviving baby as her own.

"Fetch me a sword," Solomon said. "Divide the living child in two, and give half to the one, and half to the other."

One woman embraced his solution. But the other begged Solomon not to hurt the baby and give it to her rival instead. Solomon promptly ruled in her favor, figuring that the real mother would rather give up her child than see it die.

As clever as that was, David Lee Roth may have been a bit cleverer—according, at least, to Mr. Roth himself. Here is how he tells the story in a Vimeo video. By the early 1980s, Van Halen had become one of the biggest rock bands in history. Their touring contract carried a 53-page rider that laid out technical and security specs as well as food and beverage requirements. The "Munchies" section demanded potato chips, nuts, pretzels and "M&M's (WARNING: ABSOLUTELY NO BROWN ONES)."

When the M&M clause found its way into the press, it seemed like a typical case of rock-star excess, of the band "being abusive of others simply because we could," Mr. Roth said. But, he explained, "the reality is quite different."

Van Halen's live show boasted a colossal stage, booming audio and spectacular lighting. All this required a great deal of structural support, electrical power and the like. Thus the 53-page rider, which gave point-by-point instructions to ensure that no one got killed by a collapsing stage or a short-circuiting light tower. But how could Van Halen be sure that the local promoter in each city had read the whole thing and done everything properly?

Cue the brown M&M's. As Roth tells it, he would immediately go backstage to check out the bowl of M&M's. If he saw brown ones, he knew the promoter hadn't read the rider carefully—and that "we had to do a serious line check" to make sure that the more important details hadn't been botched either.

And so it was that David Lee Roth and King Solomon both engaged in a fruitful bit of game theory—which, narrowly defined, is the art of beating your opponent by anticipating his next move.

Both men faced a similar problem: How to sift the guilty from the innocent when no one is stepping forward to profess their guilt? A person who is lying or cheating will often respond to an incentive differently than an honest person. Wouldn't it be nice if this fact could be exploited to ferret out the bad guys?

We believe it can—by tricking the guilty parties into unwittingly revealing their guilt through their own behavior. What should this trick be called? In honor of King Solomon, we'll name it as if it is a lost proverb: Teach Your Garden to Weed Itself.

* * *

ENLARGE

King Solomon famously threatened to cut a baby in half during a dispute between two women who both claimed to be its mother. The tactics were designed to make cheaters reveal themselves.
Alinari/Getty Images

Imagine you've been accused of a crime. The police say that you stole something, but the evidence is murky.

So the judge comes up with a creative solution: He decrees that you must plunge your arm into a caldron of boiling water. If you come away unhurt, you will go free; if your arm is disfigured, you will go to prison.

This is what happened in Europe for hundreds of years. During the Middle Ages, if a court couldn't determine whether a defendant was guilty, it often turned the case over to a priest who would administer an "ordeal" using boiling water or a smoking-hot iron bar. The idea was that God, who knew the truth, would miraculously deliver from harm any suspect who had been wrongly accused.

As a means of establishing guilt, the medieval ordeal sounds barbaric and nonsensical. But according to
Peter Leeson,
an economist at George Mason University, it was surprisingly effective—because it let the garden weed itself.

Dr. Leeson analyzed a set of church records from 13th-century Hungary; it included 308 cases that entered the trial-by-ordeal phase. Of these, 100 were aborted before producing a final result. That left 208 cases in which the defendant was summoned by a priest to the church, climbed the altar and was forced to grab hold of a red-hot iron bar.

How many of those 208 people do you think were badly burned? All 208? We're talking about red-hot iron here. Maybe 207 or 206?

The actual number was 78. Which means that the remaining 130—nearly two-thirds of the defendants—were miraculously unharmed and thereby exonerated.

Unless these 130 miracles were miracles, how can they be explained? Dr. Leeson thinks he knows the answer: "priestly rigging"—that is, the priest somehow tinkered with the setup to make the ordeal look legitimate while ensuring that the defendant wouldn't be disfigured. Maybe the priest swapped out the hot iron bar for a cooler one, or—if using the boiling-water ordeal—dumped a pail of cold water into the caldron before the congregants entered the church.

Why would a priest do this? Was he simply showing mercy? Had he taken a bribe from a wealthy defendant?

Dr. Leeson sees a different explanation. As we noted, a guilty person and an innocent one often respond differently to the same incentive. So, facing a medieval ordeal, what might the guilty suspects and the innocent ones be thinking?

A guilty person is probably thinking: God knows I am guilty. Therefore, if I undergo the ordeal, I will be horribly scalded. Not only will I then be imprisoned or fined, but I'll spend the rest of my life in pain. So perhaps I should go ahead and confess.

And what would an innocent person think? God knows I am innocent. Therefore I will undergo the ordeal since God would never allow this fiery curse to harm me.

All this, Dr. Leeson writes, "created a separating equilibrium in which only innocent defendants were willing to undergo ordeals." This helps explain why 100 of the 308 ordeals were aborted: The defendants in these cases settled before the ordeal stage—often, presumably, because the defendant was guilty and figured he'd be better off accepting his punishment without the additional pain of being burned.

But 78 defendants in this data set were scalded and then fined or sent to prison. What happened in those cases?

Our best guess is that either the priests believed these defendants really were guilty—or the priests had to keep up appearances to show that trial by ordeal really worked. So these folks were sacrificed.

Of course, the threat would lose its power if the defendants didn't believe in an all-powerful, all-knowing God who punished the guilty and pardoned the innocent. Without that fear, a trial by ordeal would be as scary as the father who's always threatening to spank his child but never does. But history suggests that most people of the time did indeed believe in an all-powerful, justice-seeking God.

Which leads us to the most bizarre twist in this bizarre story: If medieval priests did manipulate the ordeals, that might make them the only parties who thought an all-knowing God didn't exist—or if He did, that He had enough faith in his priestly deputies to see their tampering as part of a divine quest for justice.

* * *

You, too, can play God once in a while if you learn to set up a self-weeding garden.

Consider one of the most basic business transactions: hiring. This consumes a lot of time and money, especially in industries where workers come and go. So wouldn't it be great to find some quick, clever, cheap way of weeding out bad employees before they are hired?

Zappos, the online shoe-and-clothing store, has come up with one such trick. Its customer-service reps are central to the firm's success, so Zappos wants to know that each new employee is fully committed to the company's ethos.

That's where "The Offer" comes in. After a new employee has completed a few weeks of training, Zappos offers them a chance to quit. Even better, the quitter will be paid for their training time and get a bonus representing their first month's salary—roughly $2,000—just for quitting! All they have to do is go through an exit interview and surrender their eligibility to be rehired at Zappos.

What kind of company would offer a new employee $2,000 not to work?

A clever one. "It's really putting the employee in the position of, 'Do you care more about money, or do you care more about this culture and the company?' " said
Tony Hsieh,
the company's CEO, in a radio interview. "And if they care more about the easy money, then we probably aren't the right fit for them."

Mr. Hsieh figured that any worker who would take the easy $2,000 was the kind of worker who would end up losing the firm a lot more in the long run. By one industry estimate, it costs an average of roughly $4,000 to replace a single employee, and one recent survey of 2,500 companies found that a single bad hire can cost more than $25,000 in lost productivity, lower morale and the like. So Zappos decided to pay a measly $2,000 upfront and let the bad hires weed themselves out before they took root. As of this writing, fewer than 1% of new hires at Zappos accept "The Offer."

* * *

Seducing people into sorting themselves into different categories can be all sorts of useful—and not just in admirable ways.

Have you, for instance, ever received an email from someone purporting to be a government official from Nigeria, or perhaps a deposed prince or billionaire's widow from that country, asking for your assistance in securing a large fortune?

Of course you have! The writer, in florid language, describes the millions of dollars he has the rights to, if only he could extract it from some rigid bureaucracy or uncooperative bank.

That's where you come in. If you will send along your bank-account information, the widow or prince or government official can safely park the money in your account until everything is straightened out. Of course, you may need to advance a few thousand dollars for upfront fees. But you'll be richly rewarded for your trouble.

Variations of this scam have been practiced for centuries. Today, it lives primarily on the Internet and is often called the Nigerian scam because more emails of this sort invoke Nigeria than all other countries combined.

Which might lead you to wonder: If the Nigerian scam is so famous, why would a Nigerian scammer ever admit he is from Nigeria? That was the question
Cormac Herley,
a computer scientist at Microsoft Research, began to ask himself.

He'd never thought much about the Nigerian scam until he heard two people mention it from opposite angles. One talked about the billions of dollars the scammers earn. The other noted how stupid these scammers must be to send out letters full of such outlandish stories. How, Dr. Herley wondered, could both statements be true? If the scammers are so dumb and their letters so obviously a scam, how could they be successful?

He began to examine the scam from the scammers' perspective. (An August 2012 article in these pages discussed Dr. Herley's research.) For anyone wishing to commit fraud, the Internet has been a wondrous gift: It makes it easy and cheap to send out millions of bait letters to potential victims. But converting a potential victim into a real one will require a good deal of time and effort.

Imagine that for every 10,000 emails you send, 100 people take the initial bait and write back. The 9,900 who trashed your email haven't cost you anything. But now you start to invest significantly in those 100 potential victims. For every one of them who wises up or simply loses interest, your profit margin decreases.

How many of these 100 will end up actually paying you? Let's say one of them goes all the way. The other 99 are, in the parlance of statistics, false positives.

Internet fraud is hardly the only realm haunted by false positives. Roughly 95% of the burglar alarms that U.S. police respond to are false alarms, at a yearly cost of some $2 billion. One recent medical study found an astonishingly high rate of false positives—60% for men, 49% for women—among patients who were regularly screened for various cancers.

So how can a Nigerian scammer minimize his false positives?

Dr. Herley, while modeling this question, identified the most valuable characteristic in a potential victim: gullibility. Who else but a supremely gullible person would send thousands of dollars to a faraway stranger based on a kooky letter?

But how can a Nigerian scammer tell who is gullible and who isn't? He can't. Gullibility is, in this case, an unobservable trait. But the scammer could invite the gullible people to reveal themselves.

How? By sending out such a ridiculous letter—including prominent mentions of Nigeria—that only a gullible person would take it seriously. Anyone with an ounce of sense or experience would immediately trash the email. "The scammer wants to find the guy who hasn't heard of it," Dr. Herley says. "Anybody who doesn't fall off their chair laughing is exactly who he wants to talk to." Here's how Dr. Herley put it in a research paper: "The goal of the e-mail is not so much to attract viable users as to repel the nonviable ones, who greatly outnumber them."

So if your first instinct was to think that Nigerian scammers are stupid, perhaps you have been convinced, as Cormac Herley was, that this is exactly the kind of stupid we should all aspire to be. The ridiculous-sounding Nigerian emails seem to be quite good at getting the scammers' massive garden to weed itself.

This essay is adapted from the latest book by Messrs. Levitt and Dubner, "Think Like a Freak," which will be published on May 12 by Morrow. Their previous books include "Freakonomics" and "SuperFreakonomics."

Here's one hiring trick. My employer wishes to keep health insurance costs down and also hire smart people. Assume: a) Smokers incur far greater health care costs than non-smokers; b) one must not be very smart to engage in smoking; and c) smokers have poor impulse control and addictive personality. At the conclusion of a job interview, invite the interviewee to join you outside "for a smoke." If she accepts, then she's just screened herself out of the job.

Another one. My employer offers very low cost short-term disability insurance for $15 per month. My employer wishes to hire good decision-makers. To forego low-cost STD is a bad decision. At the conclusion of the job interview, present the interviewee with form to accept or decline STD. If the interviewee declines, then open the trap door beneath her chair and deposit her on the sidewalk.

About the Zappos hiring tactic: I know that $2000 will run out in not much time so with that in mind I would choose to stay. Just because I choose to stay doesn't mean i'll be a good employee, it just means that I don't give into temptation easy. There's other qualities that are needed to be good.

Any award or punishment based upon one's ancestors is Un-Constittuional, No Noble patents or grants or races of nobility are to be allowed or created, nor are any to punished for their ancestors, No bills of attaintor....

Thom, all actors have a public face and a private one; they may indeed be nothing more than a series of pretty faces, but somewhere in a performer's life, you'll find someone who knows how to manipulate the public into buying an image -- for some period of time. How else to explain the abomination known as Justin Bieber?

This piece by the Freakonomics guys was a joy to read. I read the first book and faithfully listen to the podcasts, and this article has Stephen Dubner's voice; he could practically be reading to you out loud. Thank you for clarifying the M&M mystery, especially. Van Halen just rose a notch.

African elders would test possible liars by putting them into a hut with a donkey and instructed to grab the donkey's tail and told that If they were lying the donkey would bray. Unknown to all but the elders the donkey's tail had ashes on it and anyone who came out with clean hands was a liar.

That Zappos "test" is silly. If someone went through all the trouble to get a job there, they're not going to walk away for $2k unless they've become very disillusioned in the few weeks they spent there. I guarantee you that the vast majority of employees don't care about the "culture and company" - they want a steady paycheck. The only people the test weeds out are those that took the job and found it so intolerable that they don't mind quitting and starting their job search all over again.

As a scientist, I question the worth of the Zappo's HR stunt. Unless they run randomized, controlled trials and show the long-term outcomes of their pared-down group is better than a group without the weeding, I'm not convinced that their process produces a better personnel outcome. I run experiments involving behavioral economics in health care all the time. A lot of "brilliant" ideas turn out to be not so much. Only evidence convinces me.

Smart people will take them to the cleaners. Zappos will attract a lot of people who before hire know they've just applied to get that freebie. Then they'll take their cash and go elsewhere. It's just another example of Sutton's law.

As someone who all his life has been driven by passion and a love for work, I'm offended by those who find a need to test me. I believe I'm worth what I get paid so don't feel guilty for getting my market value. But I'm insulted by the games, and so are most who work in jobs where I land. My primary motivations come from within. And that's really what most companies want.

That why small under-capitalized companies will offer their employees little pay -- but plenty of shares via the ESOP plan as an incentive to work 60-hour weeks until the company goes public. While some employees will jump ship for "greener pastures", they tend to be the ones who work 9 to 5 and do just enough to "meet expectations"

Those who obviously have a long-term focus, like the many Microsoft millionaires, eventually get their "just rewards".

With respect to the Nigerian scammers, I think another motivation for the ridiculously false, error filled letters is to portray the scammer as a really stupid person who could easily be duped by your average American. This tactic is used in many scams.

""It's really putting the employee in the position of, 'Do you care more about money, or do you care more about this culture and the company?' " said Tony Hsieh, the company's CEO, in a radio interview. "And if they care more about the easy money, then we probably aren't the right fit for them."

That's the biggest pile of bull I have ever heard of, yet it's surprisingly prevalent among HR and certain group of egomaniacal founders. It's arrogant and frankly just plain wrong: you expect someone who never worked in your company to somehow care "more about the culture and the company" than the thing that actually feeds them called money? If the founder believe so much in his own magic trick, why not just ask his hires to commit to 3 year internship without pay so that they could show him they are "care more about the company than about money"? What's money indeed? Why talk about such a disgusting piece of greedy capitalistic invention than focusing delivering great wonderful product to "make the world a better place"? Try and see how many people take his offers.

Asking people who know squat about your company to love and show commitment to you is not more different than asking your first date to give you all of his money (in the case of girl) or have unprotected sex to impregnate her (in the case of guy) so that she/he can show their commitment to you rather than your look/money. It's an sign of too much inflated ego that somehow feels like one's so wonderful and awesome that others must sacrifice their own interests to prove themselves before they are even given the chance. Anybody who believes it would only have in the hands, at the end of the day, a bunch of posers who are smart enough to see through your not so cleve tricks but are not less willing to jump ship any time there is a better chance (it's equally delusional to think you should hire people who won't jump ship when a better chance presents itself: now you have a IQ problem. Smart people with no loyalty can still do great things and be of value. Loyal employees who are dumb as rock, well, go figure.)

"If medieval priests did manipulate the ordeals, that might make them the only parties who thought an all-knowing God didn't exist—or if He did, that He had enough faith in his priestly deputies to see their tampering as part of a divine quest for justice."

A third possibility: The priests rationalized that their own human judgments were the will of God.

It's a very human trait, to rationalize that what suits you is best for everyone. We certainly see it every day in politics.

Talk about gullible! The authors present King Solomon as a historical figure, while historians and archaeologists are very much divided on whether he even existed. It seems that if you tell some tale but write it on fancy paper and tell everyone it's true for a couple of thousand years or more,everybody believes it. Please, start the first sentence with, "According to the Bible..." Then we know that you're not as gullible as some of the people you are writing about.

I love the story about priests in the middle ages. It reminds me of the employment character application with dozens of questions, including, "Have you ever stolen from your employer?" The thief is in a quandary. He thinks they are trying to sniff out liars so he needs to be truthful. He is convinced that everyone steals, It is his rationale for continuing to steal, so he decides to be honest. "yes"

This reminds me of another scam: "We are the Government. Send us all of your money and we will re-distribute it equitably."Despite the disastrous consequences for those who have been gullible enough to fall for it, we still have Democrats trying to run this scam in our country today.

The idea that the Nigerian scammers are trying to weed out the ones who aren't gullible is really a clever misdirection of causation, but is nonsense. They aren't trying to weed anyone out. They hope everyone of their 10,000 emails are answered by people willing to send them money. But they know only a few, maybe even only one, will be so stupid as to answer their ad. The weeding effect is what Stephen Jay Gould might have called a spandrel in evolutionary theory, an incidental benefit to the strategy of scamming gullible people (or in evolutionary theory, a benefit left over after natural selection has taken its cut).

These guys (the authors of the forthcoming book) are really too clever by halves. Correlation does not determine causation, but might imply causation. What these guys do is take two things appearing closely together (correlation) and turn ordinary causation analysis on its head from there. If A and B appear together, (the rooster crows as the sun comes up) then A must be causing B or vice versa. The whole premise of their clever counter-intuitive analysis is that maybe the rooster is actually causing the sun to come up. It's nonsense, but it sells books.

Regarding the company that tries to weed out people who aren't commited to their culture (selling shoes online requires a "culture"?), what those guys are really doing is weeding out the un-gullible. Of course the company's founders are doing it for money. Because they want the employees to work as serfs so they might get richer, they want them to buy into the culture. In that regard, it's more akin to the Nigerian scammers. An incidental benefit to their program is that skeptics get weeded out quickly, so they can pay the rest squat for their efforts because these are the ones who "believe" in the company's mission.

Great Article and Title; sounds like M. Gladwell meets Marcus A. for the post-modern world. It's a funny comment by Zappos execs...do they care more about the company than money? Or is the company a sort of religion. Most people work to pay their bills and cultivate their lives. People who live to work end up supporting only the Execs, in my view.

2) I don't think anyone can offer a job and then immediately take it away based on the decision of benefits from the newly hired employee.

3) It may keep your total cost of the benefits you provide if that person declines.

4) That newly hired "employee" may already have a great disability plan that they purchased from an insurer that wasn't provided through work. Most disability plans will always be good as long as the person insured works in the same industry.

5) It can also be smarter to stay with your own disability plan rather than always accepting the one your employer provides. Just because the one through work is cheap, doesn't mean it provides the best benefits. Maybe the one through work will only replace 50% of income, when theirs is 80%.

6) It's not your decision to make, only the person hired, it is not a good indicator of whether that employee will make a good employee.

The article mentions that the Zappo's deal is only offered to employees after several weeks of training; that's a lot of time and effort to put in for a rather small payout. A "smart person" looking for freebies could probably make a lot more money with a much smaller time investment by simply applying for every government welfare and grant program they can find. Hence why less than 1% of Zappo's hires take the deal, and 10% of the population of West Virginia has successfully claimed to be so profoundly disabled that they are incapable of work, a trait shared by 82% of retiring California Highway Patrol officers.

I quit reading past the M&M comment. A staging sup isn't going to look at this part of an artist's rider. It sounds nice though. This is akin to assuming a cruise ship will sink because a cleaner puts the wrong mint on your pillow.For gear setup, I cannot imagine they traveled with out their own band tech checking/running each load-in

All the climate research is based not on hard data but computer models. These models are very much like the five year plans of the Communists. They predicted exactly how much crime each section of a region and guess what, it happened.

These models may be accurate but may not. Taking real time measurements can reveal the facts. Limbaugh May or may not be right. Only time will tell.

If conservatives are members of the "ignorantsiya," would you mind explaining to me what makes progressives so "brilliant," given that they subscribe to socialist tenets that have failed everywhere since they were introduced over 150 years ago by Marx

Really? I think those who don't listen are small minded and willfully ignorant (that looks like you). This is the usual case of dedicated socialists and Democrats, which are the same these days. No, its time for you to get smart but maybe you are too intoxicated with the kool aid of left. I really don't like sheep.le.

To prove my point read "Cold Sun" by John L Casey and go to www.spaceandscience.net. After you have done that than tell us what you think. Hopefully, you aren't willfully ignorant.

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